RENEWABLE ENERGY:

China's A-Power to build U.S. turbine factory

Michael Burnham, E&E senior reporter

Greenwire: Tuesday, November 17, 2009

China's A-Power Energy Generation Systems Ltd. and the U.S. Renewable Energy Group -- partners in a Texas wind farm that has raised eyebrows and concerns on Capitol Hill -- announced plans today to build a wind turbine production factory in the United States.

The 320,000-square-foot plant would employ roughly 1,000 U.S. workers and produce 1,100 megawatts of turbines annually for projects in the Americas, according to an agreement signed by the companies. The turbines would be built with technology licensed by A-Power and mechanical components sourced from U.S. manufacturers.

"A-Power sees great opportunities in renewable energy in America, and this state-of-the-art facility will be our first major step towards bringing clean, renewable energy to the world's largest wind power country," A-Power chief operating officer and director, John Lin, noted in a written statement.

A spokesman for U.S. Renewable Energy Group, a private equity firm based in Washington, D.C., declined to comment as to where the turbine factory would be located and when it would begin producing turbines.

News of the factory comes less than a month after Cielo Wind Power LP, an Austin, Texas-based wind energy developer, announced plans to build a 600-megawatt wind farm south of the Texas Panhandle. Partners in the $1.5 billion project include U.S. Renewable Energy Group and the A-Power subsidiary Shenyang Power Group.

The wind farm would include 240 wind turbines made in Shenyang, an industrial city in northeastern China. The consortium has said it plans to secure most of the money needed to build the project from commercial banks in China, as well as seek financial assistance through the $787 billion American Recovery and Reinvestment Act.

Money for the Texas project would be available through the stimulus law's Section 1603, which provides a cash payment in lieu of a tax credit totaling 30 percent of the qualifying cost of a project, according to the Energy Department.

Sen. Charles Schumer (D-N.Y.) is urging DOE to reject stimulus support to the consortium because it would use Chinese-made turbines (E&ENews PM, Nov. 10). The consortium estimates that the project would create about 2,800 jobs -- including 330 construction and operation jobs in the United States.

"The purpose of the Recovery Act was to jump-start the economy and create and save jobs -- American jobs," Schumer wrote in a Nov. 5 letter to Energy Secretary Steven Chu. "Yet, the Texas wind farm project would create an estimated 2,000-3,000 clean-energy manufacturing jobs -- in China."

It appears unlikely that the turbine factory A-Power and U.S. Renewable Energy Group intend to build would be up and running quickly enough to provide turbines for the Texas wind farm. Cielo has said it plans to break ground on the wind farm next March and complete it within a year.

In a news release, A-Power noted that its factory would provide turbines for projects in North America and South America.

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